Lifting the Offshore Drilling Ban: A Positive Step in the Fight against High Energy Prices

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Washington must do something about the increasing price of
gasoline, now topping $4 per gallon. One important step would be to
tap our own supplies of oil. Yet for decades, overlapping
congressional and presidential restrictions on drilling for energy
in the Outer Continental Shelf (OCS) have stood in the way of lower
prices for oil and natural gas.

The President took a positive step today by rescinding the
executive moratorium on exploration and production in American
waters. However, Congress still needs to act in order to make this
oil available.

Congressional Restrictions on Drilling

Many of America's offshore areas are off-limits to energy
production. Beginning in 1982, Congress restricted more and more
offshore areas through annual Department of the Interior (DOI)
appropriations. The DOI has authority over the OCS, which includes
most areas more than three miles offshore. Through this annual
process, Congress chose to deny DOI the funding necessary to
conduct leasing of new offshore areas to oil and natural gas
companies.

These off-limits areas comprise 85 percent of the OCS-almost
everywhere except the central and western Gulf of Mexico-and the
congressional moratoria have become a standard feature of each
year's DOI appropriations bill. Until recent years, these
restrictions were easily renewed with little controversy, but with
the dramatic rise in oil and natural gas prices, as well as the
desire to reduce oil imports from unfriendly foreign countries,
there have been several legislative efforts to roll them back. Thus
far, none of these efforts has been successful.

Most recently, H.R. 6108, the Deep Ocean Energy Resources (DOER)
Act, would allow each coastal state to decide whether and where it
wants drilling off its coast out to 100 miles. Beyond 100 miles
from the coast, states would not have veto power; thus, deepwater
areas would be open to exploration and production. The bill also
has provisions for revenue sharing between the federal government
and each state that allows drilling, similar to provisions that
allow drilling on federal lands. The bill is modeled after the 2006
DOER Act, which passed the House but was never considered in the
Senate.

In addition, H.R. 2784, the National Environment and Energy
Development Act, would also open up much of America's waters to
energy production. Despite having 171 co-sponsors, it has yet to be
allowed to come to a vote.

Lifting the White House Opposition to
Drilling

In 1990, President George H. W. Bush issued a presidential
directive restricting new offshore exploration and drilling. In
1998, President Bill Clinton extended these restrictions through
2012. For his first seven years in office, the current President
had not seen fit to lift the moratorium, and he was unhelpful
during debate over the 2006 DOER Act.

Now the President has lifted the executive branch restrictions
and said that he will support legislation opening the OCS. If
Congress is serious about addressing high energy costs, it should
quickly send legislation to the President that removes restrictions
on these vital energy reserves.

Tremendous Potential with Little Risk

These restrictions effectively banned new offshore energy
production off the Atlantic and Pacific coasts, parts of offshore
Alaska, and the eastern Gulf of Mexico. Recent DOI estimates put
the amount of energy in these off-limits areas at 19.1 billion
barrels of oil and 83.9 trillion cubic feet of natural
gas-approximately 30 years' worth of imports from Saudi Arabia and
enough natural gas to power America's homes for 17 years. It should
also be noted that these initial estimates tend to be low.

OCS restrictions are a relic of the past. They were put in place
at a time when energy was cheap, the need for additional domestic
supplies was not seen as dire, and the political path of least
resistance was to give in to environmentalists. All that has
changed, with more than a quadrupling of oil and natural gas prices
since the restrictions were first imposed. Extra energy is badly
needed, and the risk of producing it has been reduced. All new
drilling would be subject to strict safeguards and would require
state-of-the-art technology with a proven track record for limiting
the risk of spills.

One Step Closer

By lifting the executive moratorium against OCS exploration and
production, the President has brought America one step closer to
accessing promising sources of domestic oil and natural gas for
decades to come. Now, Congress must show the nation that it is
serious about meeting our energy needs by supporting the production
of American energy from American waters.

Ben Lieberman is
Senior Policy Analyst in Energy and the Environment in the Thomas
A. Roe Institute for Economic Policy Studies at The Heritage
Foundation.